§ 4804. License denial; nonrenewal; or termination causes

(a) The Commissioner may suspend, revoke, or refuse to continue or renew any license issued under this chapter if, after notice to the licensee and to the insurer represented, and opportunity for hearing, he or she finds as to the licensee any one or more of the following conditions:

(1) Providing incorrect, misleading, incomplete, or materially untrue information in the license application;

(2) Any cause for which issuance of the license could have been refused had it then existed and been known to the Commissioner at the time of issuance;

(3) Violation of, or noncompliance with, any insurance laws, or for violation of any lawful rule, regulation, subpoena, or order of the Commissioner or of a commissioner of another state;

(4) Obtaining or attempting to obtain any license through misrepresentation or fraud;

(5) Improperly withholding, misappropriating, or converting to his or her own use any monies belonging to policyholders, insurers, beneficiaries or others received in the course of his or her insurance business;

(6) Misrepresentation of the terms of any actual or proposed insurance contract;

(7) Conviction of a felony or misdemeanor involving moral turpitude;

(8) The licensee has committed any unfair trade practice or fraud as defined in this title. It shall be an unfair practice under this section for a licensee to:

(A)(i) Sell, solicit, or negotiate the purchase of health insurance in this State through an advertisement which makes use directly or indirectly of any method of marketing which fails to disclose in a conspicuous manner that a purpose of the method of marketing is solicitation of insurance, and that contact will be made by an insurance agent or insurance company.

(ii) Use an appointment that was made to discuss Medicare products or to solicit the sale of Medicare products to solicit sales of any other insurance products unless the consumer requests the solicitation, and the products to be discussed are clearly identified to the consumer in writing at least 48 hours in advance of the appointment.

(iii) Solicit the sale of Medicare products door-to-door prior to receiving an invitation from a consumer.

(B) As used in this subdivision, the term "Medicare products" includes Medicare Part A, Medicare Part B, Medicare Part C, Medicare Part D, and Medicare supplement plans;

(9) In the conduct of his or her affairs, the licensee has used fraudulent, coercive, or dishonest practices, or has shown himself or herself to be incompetent, untrustworthy, or financially irresponsible;

(10) His or her license has been suspended or revoked in any other state, province, district, or territory;

(11) The licensee has forged another's name to an application for insurance or to any document related to an insurance transaction;

(12) The applicant has been found to have been cheating on an examination for an insurance license;

(13) Knowingly accepting insurance business from a person who is not licensed;

(14) Failing to comply with an administrative or court order imposing a child support obligation; or

(15) Failing to pay State income tax or comply with any administrative or court order directing payment of State income tax.

(b) The license of a business entity may be suspended, revoked, or refused if the Commissioner finds, after notice and opportunity for a hearing, that an individual licensee's violation was known or should have been known by one or more of the partners, officers, directors, or managers acting on behalf of the business entity, and the violation was neither reported to the Commissioner nor corrective action taken.

(c) In the event that the action by the Commissioner is to not renew or to deny an application for a license, he or she shall notify the applicant or licensee and advise, in writing, the applicant or licensee of the reasons for the denial or nonrenewal of the applicant's or licensee's license. The applicant or licensee may make written demand upon the Commissioner within a reasonable time for a hearing before the Commissioner to determine the reasonableness of the Commissioner's action. The hearing shall be held within 30 days from the date of receipt of the written demand by the applicant and shall be held pursuant to 3 V.S.A. chapter 25.

(d) In addition to or in lieu of any applicable denial, suspension, or revocation of a license, any person violating this subchapter may, after hearing, be subject to an administrative penalty of not less than $500.00 nor more than $2,500.00. (Amended 1973, No. 217 (Adj. Sess.), § 14; 1995, No. 167 (Adj. Sess.), § 20; 2001, No. 97 (Adj. Sess.), § 12; 2007, No. 80, § 22.)